Scorn Trails AIG Executives, Even in Their Driveways

James Barron and Russ Buettner|The New York Times

Published 5:23 AM ET Fri, 20 March 2009
Updated 11:54 AM ET Thu, 5 Aug 2010
The New York Times

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The A.I.G. executive who was nicknamed “Jackpot Jimmy” by a New York tabloid walked up the driveway toward his bay-windowed house in Fairfield, Conn., on Thursday afternoon. "How do I feel?” said the executive, James Haas, repeating the question he had just been asked. “I feel horrible. This has been a complete invasion of privacy."

Mr. Haas walked on, his pink shirt a burst of color on a slate-gray afternoon. The words came haltingly. "You have to understand,” he said, “there are kids involved, there have been death threats. ..." His voice trailed off. It looked as if he was fighting back tears.

Too late. Jean Wieson, who has lived down the block for 24 years, had stopped her car in front of Mr. Haas’s house before he arrived home. She was angry about the millions of dollars in bonuses paid to its executives, the credit-default swaps that brought American International Group to its knees, the $170 billion the federal government has spent to prop it up. "It makes me absolutely sick," she said. "It’s despicable. It’s disgusting what these people have done. They should be forced to give every cent back."

Those bonuses in years past helped make A.I.G. executives into prominent local citizens. They own big houses like Mr. Haas’s, with its three chimneys and its views of Southport Harbor and Long Island Sound in the distance. Some are well-known contributors to arts groups and private schools in Connecticut communities not far from the office park in Wilton that is the workplace of many of the employees in A.I.G.’s Financial Products division, which is at the center of the storm over bonus payments.

Now these executives are toxic, and those communities are rattled and divided. Private security guards have been stationed outside their houses, and sometimes the local police drive by. A.I.G. employees at the company’s office tower in Lower Manhattan were told to avoid leaving the building while a demonstration was going on outside. The memo also advised them to avoid displaying company-issued ID cards when they left the office and to abandon tote bags or other items with the A.I.G. logo.

One A.I.G. executive, who spoke on the condition of anonymity because he feared the consequences of identifying himself, said many workers felt demonized and betrayed. “It is as bad if not worse than McCarthyism,” he said. Everyone has sacrificed the employees of A.I.G.’s financial products division, he said, “for their own political agenda.”

The public’s anger, he said, “is coming from bad facts as a result of someone else’s agenda — or just bad facts period.” Instead, he said, the so-called bonuses were in fact just payments that had been promised long ago to workers, including technical and administrative assistants.

A.I.G. employees are not the only ones seeking protection: An executive at Merrill Lynch, where bonuses have also come under fire, said that some employees had asked whether the firm would cover the cost of private security for them.

Scott Silvestri, a spokesman for Bank of America , which bought Merrill in December, would not respond to that claim, but said in a statement, “The safety and security of our associates is paramount, and we will always take the appropriate steps.”

AIG

And there may be more protests. The Connecticut Working Families party, which has support from organized labor, is planning a bus tour of A.I.G. executives’ homes on Saturday, with a stop at the company’s Wilton office.

“We’re going to be peaceful and lawful in everything we do,” said Jon Green, the director of Connecticut Working Families. “I know there’s a lot of anger and a lot of rage about what’s happened. We’re not looking to foment that unnecessarily, but what we want to do is give folks in Bridgeport and Hartford and other parts of Connecticut who are struggling and losing their homes and their jobs and their health insurance an opportunity to see what kinds of lifestyle billions of dollars in credit-default swaps can buy.”

A.I.G. paid the $165 million in bonuses to 463 of its executives, but in the uproar that erupted when the payments were made public, Mr. Liddy asked the employees to return much of that money. He said that many of them have agreed to do so.

The New York attorney general, Andrew M. Cuomo, said on Thursday that A.I.G. had handed over a list with the names of the bonus recipients. But he did not release the list. “We are aware of the security concerns of A.I.G. employees,” Mr. Cuomo said in a statement, “and we will be sensitive to those issues by doing a risk assessment before releasing any individual’s name.”

It was unclear exactly what measures the officials at A.I.G. have taken in the name of protecting the company’s executives. Officials at several police departments in Connecticut towns where A.I.G. executives live said they did not know about possible threats against the bonus recipients. “We haven’t heard of it,” said Sgt. Carol Ogrinc of the New Canaan police. “There have been no complaints made to our department.”

But several security companies in New York credited the financial crisis with a noticeable increase in some areas of their business, from protecting executives to dispatching bomb-sniffing dogs to check for trouble. “There is certainly anger among people about the economy and fear among corporate executives themselves,” said Patrick Timlin, the president of Michael Stapleton Associates, which provides bomb-dog teams.

And there is concern in places like Wilton that the scandal is tarring their town. “They’re blaming us,” said Konstantinos Papanikolaou, a manager at Orem’s Diner in Wilton, about a mile from the A.I.G. office.

Jay Fiedler of Trumbull, Conn., said his town was also a “victim,” initially of a brutal economic downturn that had been fueled by problems at companies like A.I.G., and then of the outrage that has coalesced around the bonuses that A.I.G. paid.

“It just so happened that it happened here,” Mr. Fiedler said. “The community is the victim of the fact that it takes place here.”

Others in A.I.G.’s neighborhood were clearly angry. Tamara King, an immigration specialist at a health care company whose office is adjacent to the A.I.G. quarters, said she feels disgust each time she walks past it.

"You don’t want to associate with them because it’s not a reflection on the state, it’s not a reflection on us," she said. But she added, “You have so many people out of a job, and these people think they can take the money and run."

The largest single bonus check, for $6.4 million, went to Douglas L. Poling, an executive vice president for energy and infrastructure investments. Mark Herr, an A.I.G. spokesman, said Mr. Poling had told him he was returning the bonus “because he thought it was the correct thing to do.”

Gerry Pasciucco, a former vice chairman of Morgan Stanley who was brought in by Mr. Liddy in November to wind down the financial products unit, said Mr. Poling had sold off roughly 80 percent of the unit’s assets. Mr. Pasciucco said the money from the sales would go to the government, which has handed more than $170 billion in bailout money to A.I.G. in the last six months.

“He’s done an outstanding job in winding down his investment books,” Mr. Pasciucco said. "He did it at the right time, and we’ve made money. We would be losing money today if we waited to sell some of these assets."

Mr. Poling’s father, Harold A. Poling, retired as the chief executive of Ford Motor Company in 1994. On Thursday, Cheryle Campbell answered the phone at Harold Poling’s house in Bloomfield, Mich., where she said she had worked as a housekeeper for 20 years. She said she was not surprised to hear that Douglas Poling had decided to give back his bonus. “You’d think, being in the kind of job he is, that he’d be one of those sharks,” she said. “But he’s not at all.”

Douglas Poling has lived in the same house on a dead-end street in Fairfield for 11 years. The local papers say that he and his wife have given generously to a homeless shelter, to the Westport Country Playhouse and the Fairfield Country Day School, a boys’ prep school where tuition runs as high as $29,300 a year.

But on Thursday, his house, like Mr. Haas’s, was being watched by private security guards.